In order to make money in day trading a trader needs to have more winning trades than losing trades. And the amounts gained should be at least as much as amounts lost. As a rule the trades most likely to succeed are not those with the most potential profit.. To assure high win rates a trader should be willing to exit trades with reasonable profits and get out of bad trades with minimal losses. At DayTradeSafe we create benchmarked professionals who know how to enter, manage, and exit trades with reliable profits again and again.
Day Trading Futures Strategies
Day trading strategies that can offer high win rates include scalping, arbitrage, channel trading, reversals, and trend following of futures. It is important to trade in liquid markets with substantial trading volume. These markets are the best for successful use of technical indicators. Successful traders tend to focus on just one or two of these strategies in order to reap reliable profits day after day. That having been said, knowing multiple strategies allows a trader to adapt to various markets.
Day Trading Hedging Strategies
A common approach that allows for hedging in day trading is trading options. Hedged trades typically guarantee limits on losses in return for limits of profits. Day trading hedging strategies reduce uncertainty while limiting losses and, at the same time, not significantly cutting back on potential gains. What are eliminated are huge losses in return for huge gains. When properly executed day trading hedging strategies can provide steady profits.
High Probability Day Trading Strategies
In the hands of most traders the high probability of success comes with trend trading. Either fundamental factors or a shift in market sentiment is carrying futures, options, stocks, or a currency pair up or down. A trader can enter and leave the market in short bursts, taking profits with each turn. Because trends can reverse, smart traders always set stops to take reasonable profits or limit losses throughout the trading day. When day trading a trader always exits their trades before the close.
Momentum Day Trading Strategies
When trading momentum a day trader purchases futures, stock, or currency pairs when they see movement to the upside. Then they sell as momentum slows. The process can be repeated again and again as market fluctuations caused by profit taking commonly insert short term corrections even into strongly rising markets. When a future, stock, or currency pair hits resistance the process can also be repeated as the market retreats back to where it originated making this approach one that be applied again and again.
Emini Day Trading Strategies
As a rule the best strategy for trading Emini futures or micro Emini futures is to try to get into a trend early and hold until the close of the trend. This approach requires that the trader pay close attention to their trading indicators and stay tuned to the trade as they manage it. Resetting trading stops along the course of the trade helps limit losses and ensure profits but stops need to be reset as the price of the Emini steadily rises throughout the trading day.
Backtesting Day Trading Strategies
Back testing is an important part of developing your high win rate day trading strategies. Using historical data a trader reconstructs trades what would have been used in the past using rules that govern the strategy in question. Doing this demonstrates the potential effectiveness of the strategy being tested. As with any testing process, this approach should be applied multiple times in varying historical situations in order to assure its effectiveness.
Day Trading Stock Options Strategies
The stock market can be very predictable in some limited situations. For example, it is common that after a down day in the market some investors will place buy orders in the morning. When the down market is caused by strong changes in fundamentals the initial surge in a stock or index will be quickly followed by a plunge. An often-used options strategy that takes advantage of this phenomenon is the bear call spread in which the trader sells a call on the stock or index and then buy another at a somewhat higher strike price. The trade starts with a credit which remains when the stock or index drops. If the price does go up this trade’s loss is limited by the call at the higher strike price. In competent hands this one of the high win rate day trading strategies.